The Irish international was offered a new contract by Blues, but following lengthy negotiations he has declined it and is believed to be finalising a move to a Premier League side as a Bosman free agent.
Manager Gary Rowett revealed to bcfc.com: "Throughout the whole process we have been open and honest with one another, which is the way it should be.
"Unfortunately Darren has informed us he will be leaving and naturally we are sorry to see him go.
"He has been an excellent player for us, an integral part of the team that finished tenth this season.
"Success breeds success and players do get other opportunities put before them which they feel they have to take.
"Darren leaves with our very best wishes and our thanks for his contribution.
"As a Club we now move on and we look elsewhere.
"We are determined to build on our finish to the season and strengthen our squad over the summer and a lot of work has been going on already to hopefully help us do that."
Blues have re-signed Paul Robinson, Jonathan Spector, Nick Townsend and Charlee Adams since the campaign finished and also added Alex Jones to the ranks.
And Rowett and his backroom team have been busy for several months identifying possible new recruits and planning for all eventualities, for example Randolph's departure.
When Rowett spoke about Randolph's future towards the end of the season he revealed that there was Premier League interest in the 28-year-old.
Randolph has been one of Blues' most consistent performers since arriving at the Club in 2013 after leaving Motherwell.
Last season he made 46 appearances for Rowett's side and has made 92 in total.